(Adds details on gas supply in second paragraph.)
Oct. 26 (Bloomberg) -- Indonesia agreed to sell natural gas from the Gajah Baru field in West Natuna to Singapore at a price of $17 per million British thermal units to avoid paying a fine for late delivery.
The gas field is operated by Premier Oil Plc, and the fuel was originally to be supplied to one of Indonesian utility PT Perusahaan Listrik Negara’s power plant, Indonesian Energy Minister Jero Wacik said today in Jakarta.
“If we didn’t swap the gas, we would be fined 5 billion rupiah ($563,507.27) per day by a buyer in Singapore,” said the minister. The gas should have been delivered by Oct. 1.
Indonesia supplies gas from West Natuna via offshore pipelines to Singapore’s Sembcorp Gas Pte Ltd, according to the website of Singapore’s Energy Market Authority.
Indonesia will supply the fuel for 17 years to Singapore, the minister said. Rudi Rubiandini, operational management deputy at BPMigas, the country’s oil and gas regulator, said Singapore will receive as much as 140 million BTUs with the additional natural gas supply from Gajah Baru.
“The gas may be piped in early November,” Rubiandini told reporters.
Perusahaan Listrik Negara will receive gas from ConocoPhillips’s field on Sumatra island to compensate for Gajah Baru gas which is being diverted to Singapore buyer, he added.
--Editor: Mike Anderson
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